WorkChoices and Independent Contractors: The Revolution That Never Happened

Stewart, Andrew, The Economic and Labour Relations Review : ELRR

The contributions that form the centrepiece of this special edition, from Margaret Gardner, Keith Hancock, John Niland and Ron McCallum, offer diverse insights both as to the policy debates that have shaped Australian workplace relations over the past 25 years, and as to the opportunities and challenges that now confront the Rudd Government. But one feature they share is that they have virtually nothing to say about the regulation of work performed outside the confines of the traditional employment relationship. Their focus is unremittingly on employers and employees.

From one point of view, this might seem odd. The 'increasing scope of atypical employment arrangements' to which Margaret Gardner alludes has not just been about employees working part-time, or as casuals, or on fixed term contracts, or away from a traditional workplace. It includes a large number of workers who provide their personal labour as 'self-employed' contractors, rather than as employees in the common law sense (Productivity Commission 2006). There has also been a burgeoning awareness, at least in the labour law literature, of the regulatory challenges posed by forms of work that fall outside the conventional categories of employee and contractor, whether performed by volunteers, franchisees, social security recipients, prisoners, and so on (Gahan 2003; O'Donnell and Mitchell 2006).

Yet the focus of the plenary papers is in another sense entirely justified. The progressive waves of reform that occurred in 1993, 1996 and 2005, as well as the Rudd Government's recently enacted 'transitional' legislation, (1) have all involved amendments to a federal statute whose application remains anchored to the common law conception of a contract of service. (2) Federal awards and workplace agreements can generally deal only with the terms on which employees are engaged. The growing list of minimum entitlements directly established by what is now the Workplace Relations Act 1996 (WR Act) likewise apply only for the benefit of employees. And while registered trade unions are permitted to have independent contractors or other non-employees as members, at least in certain circumstances, (3) the various rights granted to unions under the Act--to enter workplaces, to enforce compliance with industrial instruments, to organise protected industrial action, to appear in tribunal proceedings--have little application to those members.

In the same vein, the public debates and advertising wars that surrounded the Howard Government's contentious 'WorkChoices' reforms were conducted almost entirely by reference to the position of employees. And in responding to those debates, the federal ALP's 'Forward with Fairness' policies were likewise framed in terms of restoring 'balance' to the treatment of employers and employees (Rudd and Gillard 2007a, 2007b). They have nothing at all to say about contractors or other non-employees.

What Might Have Been

But it could easily have been different. In the lead-up to the 2004 election, the Coalition promised to 'legislate to protect and enhance the freedom to contract and to encourage independent contracting as a wholly legitimate form of work' (Liberal and National Parties 2004: 3). For a time, it seemed that what John Howard had in mind was a two-pronged approach to labour market deregulation. Businesses who wanted to escape the 'rigidities' of the award system, not to mention the inconvenience of having to deal with unions, would be given a choice of how to do that. They might use statutory individual agreements to strip away award entitlements and block union representation, either with or without any compensating wage increase. Or, more radically, they might take a worker right outside the scope not just of the award system, but of the various minimum standards set by the WR Act for employees, by the simple expedient of hiring them under a contract that described them as self-employed.

Whether or not that was the intent behind the 2004 policy, however, it is not what eventuated. …

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